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Thursday, December 14, 2006

Calls of Note Part 5

- BMO Capital Markets notes their checks suggest that Broadcom (NASDAQ:BRCM) has obtained a noteworthy design win in the upcoming stealth phone, about to be offered by a major consumer device company.

No, it is not the application processor, neither the baseband, nor the wifi/Bluetooth. Firm's checks suggest that it is a system on a chip (SoC) that enables an onscreen touchpad feature that is likely going to enable a new type of user interface for the phone. They believe the SoC is a mixed signal, analog/digital device that has an ASP of somewhere in the $2-$3 range. It appears that there is a strong likelihood that this part shows up in the next generation media players as well.

No change to firm's model as the part adds a minimal $15 million in revenue to the top line in 2007. A slightly bigger impact could come in 2008, if the SoC is introduced in a slew of other products including the next generation media players. Separately, the firm is introducing 2008 estimates of non-GAAP $1.50, and GAAP estimates of $1.00.

Maintains Outperform but ups tgt to $38 from $33.

Notablecalls: Nice piece of research guys. Too bad it's not actionable. I wonder if it's the iPhone?

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